Ofcom backs ITV plans for regional news cuts

Ed Richards: It is becoming harder for our leading commercial broadcasters to provide public service programming. Photograph: Frank Baron

ITV should be allowed to drop some regional news bulletins, reduce regional programming by 50% and cut back on some current affairs programmes, according to media regulator Ofcom, which has forecast that up to £235m per year will be needed by 2012 to maintain public service content on commercial TV.

Ofcom has proposed that ITV be allowed to reduce its public service broadcasting obligations from next year to make the provision of "highly valued programmes" - such as news, current affairs and UK originated content - more sustainable until the end of the current licence period in 2014.

ITV would be allowed a "modest reduction" of regional news minutage, by dropping some daytime news bulletins, and slashing regional non-news programming by 50% to 15 minutes per week in England and 1.5 hours in Wales, Scotland and Northern Ireland.

The volume of current affairs programming in peak time will remain unchanged. However, the minimum outside of peak will fall by 40 minutes per week to a total of 50 minutes.

ITV's fixed quota for programmes produced outside of London has been slashed from 50% to 35% under the proposals.

This will in part be balanced by Channel 4 upping its out-of London quota from 30% to 35% from 2010 and a new quota commitment for productions sourced from Scotland, Wales and Northern Ireland.

ITV1's quotas for original UK productions, independent productions and national and international news will remain unchanged.

Ofcom is also backing ITV proposals to restructure its regional news services as a "credible means to sustain quality national and regional news services on ITV1".

ITV wants to rationalise news bulletins in the England and Scottish Borders region from 17 separate programmes to nine.

The National Union of Journalists said that Ofcom has "failed" as a regulator and that the proposals could 500 editorial jobs could be cut from ITV regional operations.

The NUJ said that the proposals would "set in train the destruction" of local and regional news and that ITV "intends to make massive cuts to its regional news budgets that could see journalist numbers halved".

"With ITV poised to begin making cuts before Ofcom even completes the consultation, the regulator's soft-touch approach has failed," said Jeremy Dear, general secretary of the NUJ.

But ITV welcomed Ofcom's proposals.

"We welcome Ofcom's acknowledgement of the need to strike the right balance between these costs and benefits, which is reflected in its proposals for ITV's regional news services, regional non-news programmes and the out-of-London quota," said ITV in a statement.

"We have consistently argued that the regulatory costs and commercial benefits of holding the ITV licences need to be re-balanced between now and analogue switch off in 2012. Today's statement also sets out Ofcom's refined options for the longer term future of public service broadcasting to which the board of ITV will give careful consideration."

ITV's share price climbed by almost 9% in early trading this morning, after Ofcom's proposals were revealed.

The broadcaster's shares, which closed at 42.25p, saw a surge of 8.9% at just before 10am this morning, a 3.75p increase to 46p.

ITV's share price had settled back to 44p, a 4.14% or 1.75p increase over last night's close, by 11.40am.

The regulator proposes to reduce Five's current quota for original productions from 53% to 50%.

"Audiences value public service programming highly, but strong digital TV takeup means it is becoming harder for our leading commercial broadcasters to provide this," said Ed Richards, the chief executive of Ofcom.

"We have provided a clear set of choices for maintaining and strengthening public service broadcasting in the future. Along with our proposals in the short term, timely decisions by government and parliament will be critical."

Ofcom has estimated that if UK audiences want to watch the same amount of public service content they have today, total public funding of between £330m and £420m will be required from 2012.

Existing regulatory subsidisies, such as reserved spectrum and premium position on the electronic programme guide, will contribute around £185m.

Possible sources of funding include direct public funding, Channel 4 getting a stake in BBC Worldwide and the use post-2012 of the £130m per year "excess" licence fee settlement ringfenced to pay for digital switchover costs.

Ofcom's consultation closes on December 4, with a final statement in early 2009. Ofcom said today that there is a "pressing need for action with a clear direction" from government by 2010.

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